EU Court of Justice issues judgment on Amazon’s liability regarding counterfeit goods sold on the Amazon Marketplace

Court of Justice of the European Union, 22 December 2022, Case C-148/21 and C-184/21, ECLI:EU:C:2022:1016

On 22 December 2022, the Court of Justice of the European Union (CJEU) issued a much-awaited judgment dealing with whether Amazon may be held liable for trademark infringement, when infringing products are sold by third-party sellers on the Amazon Marketplace.

The case was started by Mr Christian Louboutin, a French luxury footwear designer, whose best-known products are high-heeled shoes with a red colour outer sole. Mr Louboutin, who owns trademarks protecting this feature and who complained of sellers using the Amazon Marketplace to sell allegedly infringing shoes, sued several Amazon companies before the courts of Luxemburg and Belgium, which decided to refer questions to the CJEU for a preliminary ruling.

In previous cases that concerned operators of online marketplaces, the CJEU had considered that the use of the trade mark is made only by the sellers who are customers of the operator and not by the operator itself, since the latter does not use that sign in ‘its own commercial communication’, which is necessary for trademark infringement to be recognized (see CJEU, 12 July 2011, L’Oréal et al. v. eBay, C‑324/09 and CJEU, 2 April 2020, Coty Germany v. Amazon, C‑567/18). According to the Court, the mere fact that the operator creates the technical conditions that enable the use of the trademark by third parties and is paid for that service, does not mean that the operator itself does use the trademark. Regarding Amazon, the Court had further ruled, that merely offering storage services to the third-party sellers, without being aware of the infringing nature of the stored goods and without having the aim of directly putting such goods on the market, cannot be regarded as making use of the trademarks affixed to them.

In this case, the questions raised to the Court addressed the possible impact of the fact that the Amazon website incorporates both an online marketplace for third-party sellers and sales offers for goods directly offered by Amazon in its own name and on its own behalf. The national courts wondered whether this circumstance and other related features of the Amazon website, could lead to Amazon being regarded as making use of the trademark at stake in its own commercial communication.

The Court answered that in order to determine whether a marketplace operator does itself use a sign which allegedly infringes a trademark, it is necessary to ascertain whether the third party seller’s advertisement may establish a link between the services offered by that operator and the allegedly infringing sign, on the ground that a well-informed and reasonably observant user might believe that the operator is marketing, in its own name and on its own account, the goods for which the sign in question is being used.

The Court held that the following circumstances, consisting in the operating procedures of the website as organized by the operator, may contribute to give that impression to such a well-informed and reasonably observant user:

• Using a uniform method of presenting the offers published on the website, displaying both the operator’s own advertisements and those of third-party sellers;
• Placing the operator’s own logo as a renowned distributor on the website and on all those advertisements;
• Describing the various offers, independently from their origin, as ‘bestsellers’ or ‘most sought after’ or ‘most popular’;
• Providing services to the third-party sellers in relation to the latter’s goods, such as inter alia, dealing with the users’ questions relating to those goods, or to the storage, shipping and management of returns of these goods.

The national courts that referred the matter to the preliminary ruling of the CJEU will now have to assess, given the elements of interpretation provided in this judgment, whether Amazon, in its capacity as operator of an online sales website incorporating an online marketplace, does make use of a sign which infringes Mr. Louboutin’s trademarks.